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Security trust acquisition or surrender exemption (s. 121) toolkit
This toolkit brings together everything you need to know about self assessing trust acquisitions or surrenders for security trusts.
Under section 121 of the Duties Act 2001 the acquisition or surrender of an interest in a security trust is exempt from transfer duty in commercial arrangements where:
- the trust holds the securities and typically operates as a lender
- financiers participate in the trust rather than each holding their own security.
The exemption applies to transactions involving security trusts where:
- a member joins or exits the security trust as a beneficiary, or their interest varies
- the dutiable property of the trust comprises only existing rights of the holder of a mortgage, charge, bill of sale or other security over dutiable property in Queensland
- the trustee holds the rights for the benefit of the beneficiaries of the trust who have provided, or will provide, funds to the trust.
The exemption does not apply to trust acquisitions or trust surrenders of mortgage-backed securities or other securitisation schemes.
As a registered self assessor, if you determine this exemption will apply to a transaction, you must assess it in OSR Online.
Assessing a security trust acquisition or surrender exemption
Use the section 121 security trusts interactive help to determine if you should apply this exemption to a transaction.
Here are some tips to help you self assess this type of transaction in OSR Online.
How to lodge online
You must complete all mandatory fields under each tab in OSR Online. Mandatory fields are marked with a red asterisk. There are some specific data entry requirements.
- Select Transfer - Other than land as the Transaction class.
- Select Trust acquisition or trust surrender as the Type of dutiable transaction.
- Select Existing right as the Type of dutiable property.
- Enter a detailed description of the property.
For example: Deed adding Ace Investment Pty Ltd as a member of the Tower One Funding Syndicate.
- The transferor is the party surrendering the existing right.
- The transferee is the party acquiring the existing right.
- Answer Yes to the question: Is the consideration for this transaction less than the unencumbered value of the property included in this transaction?
- Enter the unencumbered value of 100% interest in property if known; if unknown, enter $0.00 (nil).
- Answer Yes to the question: Is an exemption being claimed?
- Select s.121 exemption acq/surr comprising only existing right from the Exemption type drop-down list.
Records you need to keep
For this type of transaction, you must keep:
- a completed dutiable transaction statement (Form D2.2)
- a copy of the trust deed for the syndicate
- a copy of any other trust deed document.
Find out more about your record-keeping obligations.
- See the data entry standards for OSR Online.
- Read the public ruling on security trusts (DA121.1).
- Refer to Chapter 2 Part 13 of the Duties Act 2001 for exemptions for transfer duty.
- Read the transfer duty rates or use the transfer duty calculator to work out a duty liability.
- See our endorsing examples for how to stamp documents for this exemption.
- Get help with OSR Online.
- View the list of approved transactions for self assessors.
- Last reviewed: 14 Oct 2020
- Last updated: 14 Oct 2020
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